Sloan was a young MIT-educated engineer who in 1898 at the tender age of 23 seized a risky opportunity to take over a failing company that made bearings used in machinery. He and a partner slowly built it up through hard work, attention to cost-effective manufacturing, technological advancement, and responsiveness to customers. Eventually in 1916 he sold the company to the fledgling General Motors, which then was a holding company of a hodge-podge of automobile manufacturers and related parts producers patched together by wheeler-dealer Billy Durant. At that point Sloan took the second big risk in his life, trading his large stake in his company for mostly stock in General Motors, whose future, especially given Durant’s inattention to sound business administration, was uncertain. Sloan survived many trying times as a senior executive under Durant’s erratic leadership, given that almost all of his net worth was tied up in the company stock. But Sloan’s high risk, high reward gamble paid off in time. By the early 1920s Durant was deep in a financial crisis, and eventually Sloan emerged as the chief executive. He righted the ship by further developing the management techniques which had made him a successful businessman, methods that became the foundation of modern business management.
Although there are some dry parts when Sloan gets to discussing organizational structure and finances, most of the book is a very engaging read for someone with a general interest in the history of the American automobile industry. The narrative covers a wealth of topics from the early days of the automobile, including: Durant’s wheeling and dealing from his original base in Buick to buy the group of automobile companies that would become GM; the engineering and manufacturing issues presented by resident engineering genius Charles Kettering’s attempt to develop a competitive air-cooled engine; the success of GM’s consumer-focused business model – “a car for every purse and purpose” – against Ford’s failed “any color as long as it’s black” approach; the development of leaded-gasoline and high-compression engines; GM’s groundbreaking role in the development of the diesel-electric motors that would supplant steam power in railroad locomotives; the company’s struggles to survive the Depression; the challenges of shifting to production of military vehicles and war materiel during the Second World War; and the styling revolution led by the legendary Harley Earl.
My Years with General Motors seems to be regarded as one of the seminal books on business management. In an introduction, business administration guru Peter Drucker calls it “a must read.” The cover of my paperback edition quotes Bill Gates saying that Sloan’s book “is probably the best book to read if you want to read only one book about business.” I certainly cannot gainsay this sentiment. But I read the book mostly for its narrative history and stories of engineering challenges encountered and solved. Sloan’s book is a great read even for non-MBA types interested in how the great vehicles of today came to pass.